The Splintering of “Catalyst Theory” in New York

Nancy Larcher
5 minutes ago
5 min read

Some of the New York Supreme Court, Appellate Divisions are now recognizing “catalyst theory” as a part of the New York State Equal Access to Justice Act (“EAJA”). To preserve the intent of the EAJA, it is time for the Court of Appeals to decide in favor of catalyst theory for litigants. Recently, the New York Supreme Court, Appellate Division, Third Department ruled in favor of Peter Markey, a disabled Navy veteran who sued New York State after they denied him rental assistance.^[1] The EAJA allows for plaintiffs to obtain attorneys’ fees when they prevail in certain actions against New York State and state agencies—intended to be similar to the Federal Equal Access to Justice Act.^[2] The Federal EAJA, enacted in 1980, instead allows for plaintiffs to recover attorneys’ fees from the federal government if the plaintiff prevails.^[3] One of the primary purposes of the Federal EAJA is to empower plaintiffs to seek review or appeal certain government actions and incentivize attorneys to represent them in these matters, knowing the federal government will award them attorneys’ fees.^[4]

The Markey v. Tietz decision is significant because shortly after Mr. Markey filed his lawsuit, the state approved his benefits, but then argued they were not responsible for his legal fees because the court did not rule on the merits of his case.^[5] The state tried to conclude that Mr. Markey was not a “prevailing party” and therefore, he was not entitled to the attorneys’ fees.^[6] Mr. Markey’s legal team argued they should receive attorneys’ fees under the “catalyst theory” of the New York State EAJA.^[7] “Catalyst theory” refers to litigants who obtain the requested changes from state agencies before the court rules on the merits, and should still be entitled to attorney fees since the litigant had to initiate the case in the first place.^[8] Even if the client obtained an attorney pro bono, worked out a contingency agreement with their counsel, or received free services from a nonprofit, those attorneys should still be entitled to fees from the corresponding state agency.

Catalyst theory is an important tool to increase access to justice, particularly for low-income New Yorkers.^[9] Nonprofit legal organizations, which provide direct legal services to indigent clients and/or use impact litigation to effectuate change for a class of individuals affected by the same issue, do not charge for their services.^[10] Therefore, the ability to recover fees is a critical aspect of organization funding.^[11] Furthermore, catalyst theory incentivizes private practitioners to take on cases suing state agencies and defend plaintiffs who typically could not afford a private attorney.^[12] EAJA limits recovery to individuals with a net worth less than $50,000, further proving the intent that this act was created for low-income individuals.^[13] The EAJA forces state agencies to avoid erroneous or improper conduct, while promoting accountability from these agencies.^[14]

In 2015, the New York Court of Appeals decided on Solla v. Berlin and explicitly took no position on whether the catalyst theory is New York law.^[15] Even though the Court of Appeals did not specifically reject catalyst theory, the Appellate Division took the position of rejecting catalyst theory in various cases throughout the following decade, frequently citing a 2001 Supreme Court decision, Buckhannon Bd. & Care Home, Inc. v. W. Virginia Dep't of Health & Hum. Res., that ended the catalyst theory in Federal EAJA cases.^[16] While the Appellate Division has heavily relied on this case because it is parallel to its position on the state level, the Court of Appeals has chosen to not apply Buckhannonto cases arguing for catalyst theory.^[17]

However, in 2025 and before Markey, the First Department took a significant step by finally recognizing catalyst theory under the EAJA.^[18] In Jaquez v. Tietz, Ms. Lucia Jaquez sued a New York agency to be reimbursed for disability benefits that were wrongly seized.^[19] After Ms. filed and before the judge could make a decision, the state reversed its decision to reject Ms. Jaquez’s request and reimbursed her for lost benefits.^[20] The First Department took the position that: (1) Ms. Jaquez was the prevailing party in this case; (2) she obtained the relief she sought; and (3) and the state agency only took action because Jaquez filed suit.^[21] Significantly, the First Department judges stated that they disagreed with the other intermediate appellate courts that have denied the application of catalyst theory.^[22] The Third Department cited Jacquez when deciding in favor of Markey.^[23] Both the Markey and Jaquez cases are significant wins for low-income plaintiffs and legal service providers in New York State.

The Second and Fourth Departments still do not recognize catalyst theory.^[24^]This split disproportionately harms low-income New Yorkers living in these jurisdictions, even dividing people within New York City—depending on the borough in which they live.^[25] Therefore, it is necessary for the Court of Appeals to ultimately decide whether to protect EAJA and confirm that catalyst theory is part of New York state law. Alternatively, the legislature must take action and submit clearer language, finally codifying catalyst theory.^[26]

^[1] Markey v. Tietz, No. 24-1057, slip op. 04689 at 1 (N.Y. App. Div. 3d Dep’t Aug. 14, 2025).

^[2] N.Y. C.P.L.R. § 8600; 28 U.S.C. § 2412(d).

^[3] 28 U.S.C. § 2412(d).

^[4] About the Equal Access to Justice Act, Aᴅᴍɪɴ. Cᴏɴғ. ᴏғ ᴛʜᴇ U.S., https://www.acus.gov/eaja/background (last visited Oct. 14, 2025) [https://perma.cc/F6T2-6Q2T].

^[5] Markey, supra note 1, at 1.

^[6] Id.

^[7] Id. at 3.

^[8] Joel Stashenko, Court Hears Call to Bolster Access-to-Justice Lawyer Fees, 253 N.Y.L.J (Jan. 3, 2015).

^[9] Brief for Legal Aid Society & Volunteers of Legal Services et al. as Amici Curiae Supporting Respondents, Jaquez v. Tietz, as Commissioner of the New York State Office of Temporary and Disability Assistance, 237 A.D.3d 433 (2025) (No. 2024-02497).

^[10] Id. at 2.

^[11] Id.

^[12] Id. at 2, 6.

^[13] N.Y. C.P.L.R. 8602(d)(i).

^[14] Brief for Legal Aid Society, supra note 9, at 24.

^[15] Solla v. Berlin, 27 N.E.3d 462, 465 (N.Y. 2015).

^[16] Buckhannon Bd. & Care Home, Inc. v. W. Virginia Dep't of Health & Hum. Res., 532 U.S. 598 (2001).

^[17] Solla, supra note 15, at 465.

^[18] Jaquez v. Tietz, 237 A.D.3d 433 (2025).

^[19] Id. at 434.

^[20] Id.

^[21] Id. at 434-435.